3 Top Electric Vehicle Stocks To Watch Right Now
Electric vehicle (EV) stocks have jolted many investors’ portfolios to new heights in the stock market today. This is unsurprising as the industry is one of the best performers in the stock market in 2020. The International Energy Agency states that electric vehicle sales accounted for 2.6% of global car sales in 2019. By 2030, this figure could hit 30%. With such a huge slice of the market up for grabs in the next decade, this could very well be a good time to have top EV stocks in your portfolios. From recent events, the Georgia Election undoubtedly gave Tesla (TSLA Stock Report) and other top EV stocks another boost. The rising tide even benefitted traditional automakers such as General Motors (GM Stock Report) and Ford (F Stock Report) who are just beginning to dabble in the space.
What Is The 2021 Outlook For EV Stocks?
The industry is certainly well-positioned for growth. The certification of Joe Biden as the winner of the U.S. presidential election and the Democrat victory in the Georgia Senate races are two reasons enough to send EV stocks flying. Joe Biden ran on a progressive platform to make the U.S. carbon neutral by 2050. Will there be an EV in every driveway under the Biden Administration? That prospect does not seem too far fetched amid high expectations for heightened industry support moving forward.
Two of the president-elect’s EV policies will play a vital role in the industry. First, Biden will use the full authority of his executive branch to make progress and significantly reduce emissions. He will utilize the Federal government’s procurement system to drive towards 100% clean energy and zero-emission vehicles. Second, Biden’s Year One Legislative Agenda will deploy over 500,000 new public charging outlets by the end of 2030. The agenda will also restore the government’s EV tax credit to target middle-class consumers to increase widespread adoption. With so many exciting developments to come for the EV industry, here are 3 top EV stocks to watch in the stock market today.
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Top EV Stocks To Watch In The Stock Market Today
Top EV Stocks To Watch Right Now #1 Nio Inc.
There’s no question that Nio (NYSE: NIO) has been one of the best-performing stocks in the EV industry in 2020. The company’s stocks were moving higher on Thursday. This is simply because investors are gearing up to prepare themselves for the company’s NIO Day, set for Saturday. In particular, investors will likely be keeping their eyes on a new sedan model and longer-range battery packs. I guess it’s safe to say that the recent bullishness came from the anticipation around those announcements.
Recall that Nio had a very strong finish to the year by delivering 7,007 vehicles in December. This represented a 121% increase year-over-year. You could credit the company’s success is due to its location in China, being the largest consumer market for EVs in the world, and huge financial support from the government. With so many resources under its belt, it has all the reasons to expand its lineup. The company plans to introduce a new model each year going forward. This will no doubt boost Nio’s sales in the years to come as the demand for EVs increases. With the company’s long growth runway going forward, will you consider having NIO stock in your portfolio?
“2020 has been a challenging year for the whole world. Against this backdrop, NIO has achieved consecutive record-highs along the way, and closed the year on a high note with a remarkable December delivery of over 7,000 vehicles,” said William Bin Li, founder, chairman, and chief executive officer of NIO.
Top EV Stocks To Watch Right Now #2 SwitchBack Energy
Apart from pure-play EV stocks, the “pick and shovel” play around EV could do just as well in terms of bringing value to shareholders. Switchback Energy (NYSE: SBE) is another EV special purpose acquisition company (SPAC) that is skyrocketing along with other EV related stocks. For investors who come across this company for the first time, here’s what to know. Switchback Energy plans to complete its merger with ChargePoint early this year.
Similar to Blink Charging (BLNK Stock Report), ChargePoint was founded in 2007 and has been expanding ever since. ChargePoint is currently operating the largest EV charging network in the U.S. and is expanding in Europe as well. These make it a top EV charging stock that is worth a closer look. From a fundamentals perspective, ChargePoint’s business should be strong as the U.S. is clearly adopting EVs quickly. The strong growth of EVs will undoubtedly result in strong demand for charging stations. Therefore, the company is well-positioned to benefit from such a shift.
In today’s EV gold rush, ChargePoint is selling shovels. That is to say, no matter who ultimately dominates the EV space, someone needs to provide the infrastructure that will keep millions of vehicles powered. Who knows, that someone could be ChargePoint. With ChargePoint’s leadership position and the funds it will obtain from the merger deal, would you say SBE stock is a steal right now?
Top EV Stocks To Watch Right Now #3 QuantumScape
Another pick-and-shovel play to watch would be QuantumScape (NYSE: QS). The company’s stock price has been rebounding nicely after the abrupt 40% fall on Monday. High expectations coupled with high risk is a classic recipe for a volatile stock. And that could help explain QS stock’s recent volatility. For starters, the company is looking to disrupt the world of batteries and all things electric. With such impressive technology, it is not surprising why this company has garnered investments from several impressive backers. These include Bill Gates, General Motors, Ford, and Volkswagen (VWAGY Stock Report).
The company is working on solid-state batteries. Some see technology as a holy grail in the EV business. And they could be right. The technology could potentially make batteries that are cheaper, quicker to charge, and provide a longer range to electric vehicles. But the caveat is that nobody has actually made a complete solid-state battery at a reasonable cost yet. Of course, if QuantumScape’s batteries work as promised, EV automakers would be lining up to purchase the batteries. And when that happens, QS stock would be going to the moon.
While the technology from QuantumScape holds promise, investors have reasons to be cautious when dealing with this one. And to be specific, the timeline is a factor to watch closely. This is because it has a potential rival company in Toyota (TM Stock Report). In early December 2020, Toyota announced plans to unveil its own solid-state battery-powered electric vehicle in 2021. Could QuantumScape leverage its existing assets and resources to pull ahead of the competition? Your guess is as good as mine. Regardless, QS stock continues to be a top EV stock to watch in 2021.